Make your money work for you... Not the other way around! (2024)

Did you know that carefully managing your finances and making your money work for you maximizes your earning potential? Well it’s true! All is possible through either investing or saving part of your hard earned cash every month.

So get into the habit of saving or investing or both and make this put this goal on top of your goals for 2017 and beyond.

Remember that there is a clear difference between Investing and Saving. Though two might seem or sound the same, saving and investing are not the same things. Simply put saving is storing your money, while investing is growing your money.

One of the biggest difference between the rich and not so rich, is that well-off people earn interest while everyone else pays interest. It is therefore important to realise that money is a tool that can help you achieve your goals and in order for you to reach true financial independence you need to have your money begin to work for you and not you work for it.

Below are a few guidelines of how you can start process:

1. Budget

The most important way to change the way you handle your money is to budget. When you are budgeting you are making your money do what you want it to. By assigning each dollar to a category you are controlling where your money goes and what it does. This will help you begin to reach your financial goals.

2. Get Out of Debt

Do you know how much money you are paying in interest each month? How much of your monthly budget is being eaten up by student loans, car payments and credit card bills? If you could take all of that money and put it into retirement, you will be amazed at how quickly you can save for your retirement and other things that you want. Debt often becomes a burden and limits the choices that you can make. One of the best things you can do with your money is to get out of debt and stay out of debt.

3. Save Your Money

Once you have freed up all that extra money from paying off your debt you need to begin saving aggressively. There will be a point when the money you have will earn more than you do in a month. This takes quite a bit of money and in order for this to happen you need to put a large amount away each month. Once you have a six month emergency fund saved, you will need to begin investing your money. This is how you can grow your wealth most effectively. Additionally saving money can help you be prepared to handle the ups and downs that will happen throughout your life.

4. Invest your money

One of the biggest difference between the rich and not so rich, is that the wealthy people earn interest while everyone else pays interest. It is therefore important to realize that money is a tool that can help you achieve your goals. In order for you to reach true financial independence you need to have your money work for you and not you work for your money. Investing is the best way to grow your wealth. Send me an email and I can help you work through possible investment options.

Sometimes you have to spend money to make money, but a good financial planner can help you make smart decisions about other, more advanced options. Sure, a financial planner can help you make the smart saving decisions we've discussed up to this point, but that kind of advice is free—what you really want a financial planner or accountant's advice with are the tricky investment options, like these:

• Buy/remodel an investment property: Many people buy a condo or vacation home just for a little rental income, but if you're not sure where to start, get help before you go shopping. The market is much different now than when this was more popular, and your mileage will vary depending on where you live and what you plan to do.
• Start a private portfolio: Mutual funds offered by your 401(k) are one thing, but if you want to get into index funds, options, or even just start buying up stock in well-performing companies that you want to invest in, you'll need some assistance. By all means, go for it—just don't neglect your research.
• Consider annuities: The folks at The Motley Fool suggest annuities, despite their cost and limited insurance coverage, are an option worth considering if you've already started investing elsewhere. They can be difficult to cash out of, but they can yield decent returns if you find a good one. The key, of course, is finding a good one.
• Buy an investment vehicle: Depending on your age and the amount of risk you're willing to take, you can stash your extra money away in government bonds (low risk, low reward) or stock options and futures (high risk, high reward.) It's especially important to get a professional's help before wading into these waters: there are plenty of vehicles that do little more than fleece unsuspecting customers, so do your research and get help before writing any checks.

Stop Worrying and Manage Your Current Investments.